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BlackRock World Mining Trust
BlackRock World Mining is a specialist trust offering exposure to mining and metals companies globally. In addition to investing in quoted securities, the trust may also invest in royalties derived from the production of metals and minerals, physical metals and unquoted securities. It also offers an attractive dividend yield to investors.
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Evy Hambro, Co-Manager Evy Hambro is co-manager of the BlackRock World Mining Trust plc and serves as the Global Head of Thematic and Sector Investing, as well as the Head of the Natural Resources Equity Team. He is a member of the BlackRock Global Operating Committee and the Alpha Strategies Partner Group. Evy manages portfolios focused on mining, gold, and the circular economy. He has been with BlackRock since 1994, including the years with Mercury Asset Management and Merrill Lynch Investment Managers before their merger with BlackRock in 2006. Evy holds a degree in agricultural food marketing.
Olivia Markham, Co-Manager Olivia Markham, CFA, is a Director and portfolio manager on the Natural Resources Equity team within BlackRock's Alpha Strategies Group. She co-manages the BlackRock World Mining Trust, the BGF World Mining Fund, the Commodities Income Investment Trust, and various segregated portfolios. Olivia joined BlackRock in 2011. Prior to this, she led the European Mining team at UBS, covering UK diversified miners, and worked at Merrill Lynch in Sydney on Australian miners. She also spent four years in the Mergers and Acquisitions team at BHP Billiton. Olivia earned a BComm degree in finance from the University of Western Australia in 2003.
Evy Hambro, Co-Manager Evy Hambro is co-manager of the BlackRock World Mining Trust plc and serves as the Global Head of Thematic and Sector Investing, as well as the Head of the Natural Resources Equity Team. He is a member of the BlackRock Global Operating Committee and the Alpha Strategies Partner Group. Evy manages portfolios focused on mining, gold, and the circular economy. He has been with BlackRock since 1994, including the years with Mercury Asset Management and Merrill Lynch Investment Managers before their merger with BlackRock in 2006. Evy holds a degree in agricultural food marketing.
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Company Description
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Investment process
The investment process begins with a screen to evaluate the financial health, liquidity and governance of a company. This is then followed by both bottom-up and top-down research. The bottom-up research includes company meetings, financial modelling, site visits (the team regularly visit companies across the globe) and evaluation of the ESG (Environmental, Social and Governance) aspects of any potential investment.
The top-down research includes commodity and industry analysis as well as an evaluation of macro trends. This then feeds into portfolio construction – with the team focusing on diversification, relative valuations and active risk.
One of the key benefits of the trust is its flexibility – the team can use the advantages of the closed-ended structure to enhance returns for shareholders, while the managers are also able to invest in more nimble mining companies, with flexibility to shift allocations between commodities depending on their view at the time.
The trust can hold up to 10 percent of gross assets in physical metals and up to 20 percent may be invested in unquoted investments.
The trust also pays a dividend to investors. Whilst mainly invested in equities, the company makes use of fixed income and unquoted investment to enhance revenue. The global remits means the majority of its holdings generate earnings from around the world.
Risk
Mining shares typically experience above average volatility when compared to other investments. Trends which occur within the general equity market may not be mirrored within mining securities. The trust also invests in emerging markets, which are usually associated with greater risk than their peers in the developed world.
Overseas investment will be affected by movements in currency exchange rates, while there is also some exposure to smaller companies in the portfolio.
ESG
ESG - Integrated
Sustainable investing spans a range of strategies at BlackRock. The firm has some 40 professionals in eight offices around the world to oversee ESG integration with investment approaches. ESG plays an important role in the natural resources space, as miners need to demonstrate their ESG credentials to maintain a social license to operate. The team also believes embedding ESG considerations provides better risk-adjusted returns, while an ESG focus in the investment process can also help avoid “blow-up” incidents.
As a result, analysts and portfolio managers comment on ESG when completing research templates, with it being discussed in detail when meeting company management. ESG is embedded in all four stages of the process – starting with the idea generation stage where the team evaluates the investable universe; the due diligence stage takes into account any ESG issues – this includes using the firm’s ESG risk ‘Window’, which looks at a series of underlying metrics and evaluates the impact they will have on an investment. ESG conclusions are then carried forward into the decision making undertaken at the portfolio construction stage, while the continuous evaluation of companies includes a quarterly portfolio review of MSCI ESG scores and a quarterly Ethix portfolio screen.
Gearing
The board reviews the level of gearing on a regular basis with the maximum level set at 25 per cent (currently 12.4 per cent at 9 September 2022).
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